Attorney General Bonta and CalRecycle Announce Felony Arrests in $10M Recycling Fraud Scheme

Defendants are estimated to have defrauded the CalRecycle Program of over $10 million in the cities of Los Angeles and Ontario  

LOS ANGELES – California Attorney General Rob Bonta, along with the CalRecycle Director Rachel Machi Wagoner today announced the arrest and filing of felony charges against six individuals for allegedly operating a recycling fraud scheme in the Los Angeles area and defrauding California’s beverage container recycling program by bringing more than nine tons of out-of-state materials from Arizona for redemption. The defendants have been charged with recycling fraud and grand theft.  

“When individuals skirt California’s recycling laws, California consumers are hurt in the process,” said Attorney General Bonta. “The California Redemption program is an important tool in our efforts to encourage recycling, reduce waste, and address climate change. My office will continue to fiercely defend California's programs and resources — and we will hold bad actors who defraud our state accountable."

“CalRecycle works alongside our partners at the Department of Justice to root out fraud and safeguard the program that helped California recycle 454 billion bottles and cans and reduce trash pollution across the state,” said CalRecycle Director Wagoner. “Beverage deposits belong to Californians and the state will continue to actively protect these funds.” 

The California Redemption Value (CRV) program is California’s beverage container recycling program administered by CalRecycle and incentivizes recycling at privately-owned centers with a 5- or 10-cent return on eligible beverage containers. California consumers subsidize the CRV program every time they purchase CRV-eligible bottles and cans in the state. Only material from California is eligible for redemption under this program. From September 21, 2021 through March 30, 2022 a California Department of Justice investigation revealed a scheme by the individuals to import aluminum cans and plastic bottles from Arizona to the state of California to unlawfully redeem the California recycling refund value of those items.

Arizona does not have a recycling program that provides redemption value for bottles and cans. The illegal redemption of out-of-state beverage containers drains California’s CRV fund and takes funds that are subsidized by the beverage container purchases of California consumers. 

The defendants allegedly brought truckloads of ineligible materials from Arizona to recycling centers in Southern California where the scheme is estimated to have defrauded the CRV fund of more than $10 million.

It is important to note that a criminal complaint contains charges that are only allegations against a person. Every defendant is presumed innocent unless or until proven guilty.

A copy of the complaint can be found here.